Following a positive start to the year, Bitcoin's upward momentum has experienced a notable correction over the past two days. BTC attempted to break above the significant level of $95K on January 14th but has since seen six consecutive days of decline, pulling back approximately 7% from its local high of $97,900.
The total cryptocurrency market capitalization has decreased by roughly $100 billion in the last 48 hours. The altcoin market cap, as measured by the TOTAL2 index excluding stablecoins, also saw a decline of approximately 3.5% during the same period.
After failing to reclaim the $95K level on the weekly timeframe, BTC has returned to the consolidation range it has occupied since mid-November. Should selling pressure intensify, attention will shift to key support levels that must hold to preserve the broader long-term market structure.
What Caused the Selloff?
BREAKING: President Trump announces a 10% tariff on Denmark, Norway, Sweden, France, Germany, the UK, Netherlands, and Finland beginning February 1st.
— The Kobeissi Letter (@KobeissiLetter) January 17, 2026
This tariff will be increased to 25% beginning on June 1st.
Tariffs will remain in effect until the US reaches a deal to buy… pic.twitter.com/978qAHjxao
The selloff was largely triggered by macroeconomic uncertainties surrounding President Trump's renewed push to annex the arctic island of Greenland, coupled with threats of broad tariffs on eight European countries until a complete purchase is negotiated. While these developments remain highly speculative and politically charged, such headlines increase uncertainty regarding global trade tensions and diplomacy.
Consequently, investors have opted to de-risk their portfolios, rotating out of assets like BTC in favor of safer positions. This risk-off rotation is evident in the strong outperformance of commodities such as gold and silver, which are currently trading at all-time highs and have gained 9.59% and 31% year-to-date, respectively.
Key Levels to Watch
The first crucial level for BTC to hold, and where many traders might consider positioning for a bounce opportunity, is the 50-day Simple Moving Average (SMA). This currently stands at $90,400 and aligns with an ascending trendline that dates back to the lows of $80.5K recorded in November of last year.
Beyond the 50-day SMA, attention shifts to the yearly open near $87.5K, which coincides with the 0.5 Fibonacci retracement. Just below this level, the Fibonacci golden pocket, approximately $86K, represents a key zone that must hold to preserve the broader consolidation structure.
What Could Confirm the Next Move
Beyond specific price levels, confirmation of the next directional move will require an increase in trading volume. Aggregated daily exchange volume has decreased since January 16th, indicating reduced conviction behind the recent price action. This diminishing volume suggests that the market is currently correcting on thinning liquidity rather than strong directional intent. Therefore, for any sustained trend, whether upward or downward, volume needs to expand, as low-volume moves tend to be fragile and prone to reversals rather than continuation.
Looking ahead, institutional participation and activity could be a key variable to monitor. With U.S. markets closed yesterday, BTC spot ETF flows in the coming week will offer a clearer insight into whether institutional demand can offset the recent selling pressure or amplify it. Ultimately, the current backdrop largely hinges on broader macroeconomic developments. As geopolitical rhetoric and trade-related uncertainties continue to shape risk appetite, BTC's next move is likely to be driven as much by macroeconomic signals as by technical levels, making the coming week particularly pivotal for market direction.